The Elevator Pitch for Social CRM

The discourse on Social CRM can be likened to the Age of Enlightenment. During that time the first English coffeehouse was established, with other less formal hotspots for learning, conversation and debate.

Today, the same thing is unfolding across the web -- change “coffeehouse” to “Twitter” and “Republic of Letters” to “social CRM.”

Now that so many of you, the readers, are becoming interested in Social CRM, the discussions have increased ten-fold.

Gurus, Experts and Definitions on Social CRM

New definitions sprout faster than NYC umbrella vendors in November.

While a handful of companies are doing something -- most brands are still scratching their heads. That could be our fault -- because we haven’t done a good job of translating a clear idea of how their problems can be fixed with Social CRM.

Just as in any new ungoverned arena where there are a lot of people with business challenges, and people ready to capitalize on that, there are a lot of “gurus” and “experts” floating around -- this is dangerous for a couple reasons.

Vile said in his analysis of the term social CRM:

…on the customer service side, some of what I hear seems downright reckless - e.g. the harvesting of tips, tricks, and problem resolutions from social networks and facilitating the automatic propagation of these as part of your support processes. …for every useful and legitimate piece of insight or advice you come across, literally tens or hundreds of useless or even dangerous 'opinions' exist.

If you want a social CRM elevator pitch you might want to check out Paul Greenberg’s tweetable definition: “The company’s response to the customer’s control of the conversation.”

Others like Bob Thompson of CustomerThink define Social CRM as “the integration of social media and CRM. Literally: Social + CRM. If you don't have both, you don't have Social CRM.”

But he points out it’s actually much more complicated than that. He said, “in practice the ‘social’ and ‘CRM’ worlds behave quite differently.” See diagram below.

According to Bob Thompson “Social CRM” is not a technology -- it’s not anything unless the company decides.

The technology appears to be more and more of an afterthought. Some ask if software will even exist in ten years. It’s going to be all about service. And it seems the service aspect will have to be internal change management -- so it might make sense that a lot of brands will be hiring management consulting firms to help them.

Bhargava explained that the bottleneck exists within a middle layer in the corporation. Managers interpret the demands of leadership in extreme ways. Command and control management becomes the dominant mentality about running a “healthy company.” In the context of social this makes perfect sense.

Some argue that most brands still manage in a command and control environment. But people like Frank Eliason, former manager of customer service for Comcast and current SVP of Social Media for Citigroup and Seth Godin, Author of Linchpin claim social will change all of that.

Frank works [worked] at one of the most hated companies in America, a cable TV company called Comcast. On his own, without permission, he started searching Twitter for mentions of the word 'Comcast.' If you mentioned Comcast in a tweet, he would get back to you, sometimes within five minutes. He would tell you who he was and ask you to call him directly, or he would try to troubleshoot you right then and there so that you could get back online or back to TV. It worked. It worked because it was so out of the box, so generous, so remarkable, so opposite of the way people felt about Comcast.

Some argue that social media or social business, will uproot modern management as we know it. A recent article in the Wall St. Journal, “The End of Management”, while never mentioning the term “Social CRM”, appears to have clued in to a couple of pretty big epiphanies regarding the old school versus new school thinking about organizational structure.

British economist Ronald Coase laid out the basic logic of the managed corporation in his 1937 work, "The Nature of the Firm." He argued corporations were necessary because of what he called 'transaction costs.' It was simply too complicated and too costly to search for and find the right worker at the right moment for any given task, or to search for supplies, or to renegotiate prices, police performance and protect trade secrets in an open marketplace. The corporation might not be as good at allocating labor and capital as the marketplace; it made up for those weaknesses by reducing transaction cost.

Now the customer might just figure into this equation. He says, “Complicated enterprises, like maintaining Wikipedia or building a Linux operating system, now can be accomplished with little or no corporate management structure at all.”

Precisely. But the problem is we are not willing to let go. We are not willing to look at our insides. This needs to happen before we can improve our relationships with our customers and write a response to a switch in power -- what Paul Greenberg calls “The company’s response to the customer’s control of the conversation.” This response has to start inside.

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